Leasing Decisions and Credit Constraints: Empirical Analysis on a Sample of Italian Firms

22 Pages Posted: 13 Mar 2015

See all articles by Stefania Cosci

Stefania Cosci

University Lumsa

Roberto Guida

Luspio University

Valentina Meliciani

LUISS Guido Carli University - LUISS Business school

Date Written: March 2015

Abstract

Although lease financing provides a significant source of funds enabling many companies to invest, few studies examine the determinants of leasing in Continental Europe and we are aware of no study on the Italian case. This paper investigates the relationship between financial constraints and leasing decisions for a sample of Italian firms. In particular, it investigates the determinants of firm leasing decisions, the degree of substitutability between leasing and debt, and the impact of leasing on the probability of firms feeling ‘credit rationed’. Our results support the hypothesis that leasing preserves capital, thus helping to relieve credit constraints.

Keywords: Leasing, debt finance, credit rationing, capital structure

Suggested Citation

Cosci, Stefania and Guida, Roberto and Meliciani, Valentina, Leasing Decisions and Credit Constraints: Empirical Analysis on a Sample of Italian Firms (March 2015). European Financial Management, Vol. 21, Issue 2, pp. 377-398, 2015. Available at SSRN: https://ssrn.com/abstract=2577042 or http://dx.doi.org/10.1111/eufm.12019

Stefania Cosci (Contact Author)

University Lumsa

Via della Traspontina
Roma, Rome 00192
Italy

Roberto Guida

Luspio University ( email )

Via C. Colombo 200
Rome, Rome 00147
Italy

Valentina Meliciani

LUISS Guido Carli University - LUISS Business school ( email )

Viale Pola 12
Rome, 00198
Italy

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